first_img There’s also a big disconnection between employees’ and their employers’ confidence level about workers’ ability to save enough and retire on time. For instance, although 56% of employers believe their employees are saving enough for retirement, 24% of employees feel this to be the case. In addition, while 56% of employers believe more than half of their employees are on track for retirement, only 33% of workers are confident that they can retire on time. Among the employees, less than half of baby boomers (46%) and those belonging to Generation X (47%) feel they are on course for retirement while millennials (63%) are the most positive about their retirement plans. More millennials (70%) have also contributed to their DC pension plans in the past year than those who are baby boomers (63%) or part of Gen. X (61%). Yet, exactly half of baby boomers state they are counting heavily on their workplace savings to ensure a secure retirement — and 29% say their DC pension plan will be the biggest source of retirement income. Although 23% of baby boomers state they will invest their retirement savings from their DC pension plans with a financial advisor when they stop working, 26% say they will invest the funds in an account they personally manage, 24% will keep their savings within the DC pension plan, 18% are simply unsure of what they will do and 8% will move those funds to a savings account. The fact is that an increasing number of Canadians will rely on the performance of their DC pension plans for their retirement as the number of defined-benefit pension plans dwindles, says Kin Chin, director of DC solutions, BlackRock Canada, in a statement. “What we’re seeing is that there isn’t a solid understanding [among employees] of how to effectively and confidently contribute [to their DC pension plans],” says Chin. “What’s encouraging is that there is a keen desire from these employees to learn more and increase their understanding. This presents an opportunity for employers to engage their employees in taking a more proactive role in their retirement planning.” The BlackRock report also found that some companies are heeding the call to implement tools that make it easier for employees to contribute to their retirement savings plans. Within the past year, 24% changed their company’s default contribution rate, 23% began auto-enrollment and 20% added a company match to contributions. Market Strategies International produced the research for this report that is based on an online survey of 75 medium, large, and mega DC pension plan sponsors and 500 DC pension plan participants in Canada. The DC pension plan sponsors who were interviewed had at least $25 million in assets. The 500 DC pension plan participants surveyed were fully employed and participating in their employer’s registered retirement savings plan, tax-free savings account, deferred profit sharing plan, or DC pension plan. They were required to have at least $5,000 in assets in their current account. Budget 2021 revives tax issues from 2019 Tessie Sanci Keywords Pensions Canadians workers who participate in defined-contribution (DC) pension plans need more assistance from their employers in understanding their retirement options within those plans, suggests a new report from Toronto-based BlackRock Asset Management Canada Ltd. released on Wednesday. Specifically, the research indicates that more than even though more than half (55%) of employers feel their employees understand their investment options for retirement planning, only 40% of employees actually confirm this to be true. Facebook LinkedIn Twitter Canadian plan sponsors post positive quarter despite bond slump Related news Federal budget fails to support needed pension reform, retiree group says Share this article and your comments with peers on social medialast_img